City adds to contract with Aaron’s firm

BY CHRISTINE VARNO
Staff Writer

Long Branch LONG BRANCH — The City Council increased its contract with a local law firm last week in anticipation of a lawsuit by a group of property owners in one of the city’s redevelopment zones.

At the Oct. 11 council meeting, the council adopted resolution 368-05, allowing for an additional $30,000 in fees to City Attorney Jim Aaron’s firm, Ansell, Zaro, Grimm and Aaron, Ocean Township.

The action brought to $55,000 the total in fees approved for Aaron’s firm for work in conjunction with the city’s plan to take the properties through eminent domain

The firm’s original contract with the city was amended to include any possible litigation in the property acquisitions for the Beachfront North Phase II properties, which could lead to a constitutional challenge to the redevelopment process, according to the resolution.

Originally, Greenbaum, Rowe, Smith & Davis, Woodbridge, was retained in April to handle constitutional issues that could arise between the city and the Beachfront North Phase II property owners whose properties are being seized.

Greenbaum withdrew as counsel in July after the Atlanticville revealed that Judge Arthur M. Greenbaum, a senior partner in the firm, also sits on the board of directors of Hovnanian Enterprises, the designated developer of the Beachfront North Phase II redevelopment zone, and is a shareholder in Hovnanian as well.

In a letter dated July 20, Alan Davis, partner in the firm, told the city the firm declined to continue representing it in the eminent domain process.

He wrote, “On June 23, 2005, the Supreme Court of the United Sates decided Kelo v. City of New London. Our interpretation of the court’s decision has led us to reexamine our role in handling condemnation cases for the city in Beachfront North, phase II.”

According to the Supreme Court decision, Justice Kennedy, who concurred with the 5-4 ruling in favor of local governments, wrote, “There may be private transfers in which the risk of undetected impermissible favoritism of private parties is so acute that a presumption (rebuttable or otherwise) of invalidity is warranted under the Public Use Clause.”

In an interview in May, Aaron said that retaining Greenbaum’s firm did not involve a conflict of interest.

But one resident asked the council members last week if they now think that retaining Greenbaum’s firm was a conflict of interest.

“Why did Greenbaum resign — a conflict of interest?” Bill McLaughlin, Ocean Avenue, asked. “You guys do nothing about it until the people find out about it.”

Another resident, Bill Nordahl, Marine Terrace, asked Aaron if his firm was replacing Greenbaum.

“[The resolution] is adding to the original contract,” Aaron said. “We added to that when it became apparent for the need of litigation in Beachfront North, Phase II. The developers are funding it. We did not replace, just amended.”

“So Greenbaum was doing it and you are doing it now. That is the bottom line,” Nordahl responded.

Council President Anthony Giordano said, “We chose Aaron’s firm because of his experience and knowledge. We could not think of a better choice.”

The designated redeveloper of the three-street zone is MM-Beachfront North II, consisting of co-developers Matzel & Mumford, a division of K. Hovnanian, Middletown, and the Applied Cos., Hoboken. They plan to bulldoze the neighborhood and construct three buildings with a total of 185 condominium units in its place.

Greenbaum, Rowe, Smith & Davis was one of three law firms retained to represent the city in the condemnation proceedings for the MTOTSA zone.

Attorney Paul V. Fernicola, of Bowe & Fernicola, Red Bank, was retained for a $25,000 contract in May for negotiations and evaluation hearings with the MTOTSA properties.

Aaron’s firm was originally retained in May to be called on only if the city and the homeowners in the zone, known as MTOTSA (Marine and Ocean terraces and Seaview Avenue), could not reach an agreement and the city used its power of eminent domain to seize the properties.

But one resident asked Aaron to explain his added responsibility.

“This [resolution] was an addition to litigation expenses,” Denise Hoagland, Ocean Terrace, said. “Are we to assume this is not for the constitutionality case?”

“That is absolutely it,” Aaron replied. “It will allow us to take appropriate action for land acquisition; if that includes constitutional challenges, so be it.”

When Hoagland asked if a third law firm would be retained to replace Greenbaum’s firm, Aaron said, “Probably not. There may not be a need for it, but there may be a need for it.”